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DMP and lump sum payment advice

Noodle08
Posts: 7 Forumite

Advice please, we are in a DMP, my husband was in the forces and is getting a lump sum. We have lots of questions:
Do we use this to pay off our DMP in full?
Do we use this to pay off our DMP in full?
Can we ask for a full and final settlement payment to be made? Would we do this independently?
Which is best for credit as we will need to rent or buy a house in the near future. Thank you
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Comments
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There is not a lot of difference between a settled default and a partially settled default. Both ate defaults and the entry will drop off 6 years after the default date.
It is using the lump sum most effectively to offer a sum in full & final settlement. Start low as you can always go up. Maybe 30%.
If these are consumer credit act debts make sure first that the present owner can comply with a cca request.
National Debtline has a couple of useful factsheets though remember that these things are individually negotiated and you do not have to treat everyone equally
https://www.nationaldebtline.org/fact-sheet-library/credit-agreements-getting-information-ew/
https://www.nationaldebtline.org/fact-sheet-library/full-and-final-settlement-offers-ew/
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And if you do intend to do this, do it yourself, if you let the likes of stepchange do it for you, they ask you to pay them the lump sum, and then they settle with your creditors, not always much negotiation takes place.
You can get yourself a much better settlement by first sending CCA requests, then making offers once the status is known.
To obtain the best results takes time, think of it more like a marathon than a sprint.I’m a Forum Ambassador and I support the Forum Team on the Debt free wannabe, Credit file and ratings, and Bankruptcy and living with it boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.For free non-judgemental debt advice, contact either Stepchange, National Debtline, or CitizensAdviceBureaux.Link to SOA Calculator- https://www.stoozing.com/soa.php The "provit letter" is here-https://forums.moneysavingexpert.com/discussion/2607247/letter-when-you-know-nothing-about-about-the-debt-aka-prove-it-letter0 -
fatbelly said:There is not a lot of difference between a settled default and a partially settled default. Both ate defaults and the entry will drop off 6 years after the default date.
It is using the lump sum most effectively to offer a sum in full & final settlement. Start low as you can always go up. Maybe 30%.
If these are consumer credit act debts make sure first that the present owner can comply with a cca request.
National Debtline has a couple of useful factsheets though remember that these things are individually negotiated and you do not have to treat everyone equally
https://www.nationaldebtline.org/fact-sheet-library/credit-agreements-getting-information-ew/
https://www.nationaldebtline.org/fact-sheet-library/full-and-final-settlement-offers-ew/
OP I am on a DMP with stepchange and used their full and final settlement letter template , as well as the template in the link fatbelly had linked here. I contacted the company (CARS) directly. You can get a pretty decent offer if the debt had been sold on, mine was originally a 118118 money loan.
good luck with your settlements, take your time & get the best advice for you. I’m just here to let you know it’s possible & worth it
E xDebt free April 2024 !!
dfd:https://forums.moneysavingexpert.com/discussion/6510394/champagne-supernova-s-debt-free-to-savaholic-diary/p
2025 savings goals:
£1000/£1000 emergency fund
£0/£1000 Rainy Day3 -
Thank you for your comments. So the people who run our DMP state it should all be paid off as it will affect our credit rating and we can’t negotiate. Is this correct? What would you advise as the next step? Thank you0
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Noodle08 said:Thank you for your comments. So the people who run our DMP state it should all be paid off as it will affect our credit rating and we can’t negotiate. Is this correct? What would you advise as the next step? Thank you
Please don`t tell me your paying a company to run it.
No its not correct, don`t listen to their twaddle, your credit file will have been trashed already if your in debt management, as I said in my previous post, be certain, do it your self.
CCA requests first, see what is enforceable and what isn`t, then on those that are, go in with the low offer, start around 30% of debt value.
Have all accounts been defaulted, have any been sold on? (sold on accounts can be settled for much less money due to the low price they get sold for).
Unfortunately original creditors won`t be very receptive to offers, you need to just clarify the points I have mentioned the more detail the better.I’m a Forum Ambassador and I support the Forum Team on the Debt free wannabe, Credit file and ratings, and Bankruptcy and living with it boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.For free non-judgemental debt advice, contact either Stepchange, National Debtline, or CitizensAdviceBureaux.Link to SOA Calculator- https://www.stoozing.com/soa.php The "provit letter" is here-https://forums.moneysavingexpert.com/discussion/2607247/letter-when-you-know-nothing-about-about-the-debt-aka-prove-it-letter0 -
Noodle08 said:Thank you for your comments. So the people who run our DMP state it should all be paid off as it will affect our credit rating and we can’t negotiate. Is this correct? What would you advise as the next step? Thank you
Who runs your DMP?
When did the relevant debts default?If you've have not made a mistake, you've made nothing0 -
No, it’s Christians Against Poverty so not paid for. I’ll take your great advice onboard as before. Apologies if I’m back with more questions. Thank you both for commenting2
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Your local CAP rep will only have had 2 weeks rudimentary training so may well be unclear on settlement deals.
You would hope that the Head Office staff are more clued up but one of their funding streams is a rake-back from payments made under a dmp. There is no financial incentive for them to suggest F&F1 -
Don't involve Christians against poverty. Debt charities don't do anything you can't do yourself, and often their advice is beneficial for the creditors but very detrimental for you
I agree with the previous comments, make CCA requests first to see if you even need to repay anything.
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Sorry guys! Me again.Does making a settlement offer and not paying the full amount back and having a P (part payment) against that debt make any difference on your credit score. CAP believes it does and are still recommending payment in full. Thank you0
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